Mark Anctil takes his golf very seriously. "This is amazing," the Montrealer said. "My wife and I have played all over Canada, the United States and the Caribbean, but this is the most beautiful golf course I've seen in my life."

We were standing in the clubhouse watching the turquoise sea and gentle surf break near the 18th hole of Punta Espada, an oceanside course designed by golf legend Jack Nicklaus. This is the first of three planned Nicklaus Signature courses at a massive new development called Cap Cana, just south of the popular resort area of Punta Cana at the east end of the Dominican Republic. Green fees are $350 a round, which includes a caddy and a golf cart.

Best known to Canadians as a tropical refuge with reasonable prices and many all-inclusive resorts, including a few upscale properties like Casa de Campo, the Dominican Republic is taking a giant step - and an expensive gamble - toward becoming an ultra-luxury destination.

Cap Cana is turning 12,000 hectares of undeveloped scrubland into the biggest development in the Caribbean. Investment so far totals almost $500 million with twice that expected to come. When completed in 12 to 15 years, the stylish, low-density hotel-and-residential complex will feature five golf courses, a 1,000-berth marina capable of handling the biggest yachts, a mix of 5,000 condominium, villa and hotel units and a series of high-end restaurants, at least two of them with Michelin-star aspirations. Purchase prices range from $400,000 for a two-bedroom condominium to $5.8 million for a villa on the beach.

With a third of its master plan completed, Cap Canada is welcoming guests at several villa and hotel areas. Major construction is continuing along a six-kilometre stretch of sand, limestone and coral fronting the Caribbean. The Trump Organization is developing 68 homesites on an 82-metre-high cliff overlooking Cap Cana, and Ritz-Carlton has been contracted for a 220-bedroom luxury beach hotel and spa.

"Our aim is to change the perception of the Dominican Republic from buffet food in giant resorts to five-star luxury," said Linka Biaggi, communication manager at the newly opened Sanctuary Cap Cana Hotel and Spa. Including its turreted fortress (the Spa), the 170 luxury suites in this seaside hotel are designed to replicate early colonial times in the Dominican Republic. Prices per night range from $400 to $1,700, without meals. Only 60 guests were staying at the hotel when we saw it, because it's not completed.

Chefs and some service staff have been training for many months, getting ready to welcome well-heeled guests later this year. Fresh fish is delivered from local fishermen three times a day. We enjoyed some seafood at the informal Blue Marlin restaurant, built on a pier adjacent to the hotel.

Bill Sgobba of New Jersey chose Cap Cana and the Sanctuary Hotel for a family vacation because he likes the Dominican Republic and wanted to try something new. "I'm not sure if the high-end concept will work," he said. "The food and service here are certainly much better than the all-inclusives we've visited."

Feybi Rohas, the public relations co-ordinator for the whole Cap Cana project, agrees that the tourist industry will have to change its view of the Dominican Republic. "With Cap Cana, we're trying to build a new high-end tourist and retirement destination," she said. "We are Dominicans. Everybody greets you with a smile, but now we want to be the best of the best."

The massive scale of Cap Cana is not without its critics. James Sweeting, senior director at the Centre for Environmental Leadership in Business, recently visited the project. "I saw miles of coastline bulldozed," he said in an interview. "You have these wonderful resorts and golf courses but the biodiversity is gone."

The second Nicklaus golf course, Los Iguanas, which also hugs the sea, is in the middle of construction with earth-moving equipment crawling all over the property.

Ellis Perez, the VP of commercial and industrial relations, admitted that original habitat is always affected in any construction zone, but he says that management is committed to sustainable development. "Cap Cana is a huge property, and we plan to conserve as much as possible," he said. "There are a million square metres of plants and wetlands that are unique to the area and we will preserve those."

He added that the coral reefs, less than a kilometre offshore, would not be affected.

In addition to obtaining the high-profile Nicklaus, Trump and Ritz-Carlton brands, management's determination to build a world-class resort complex is perhaps most evident in its commitment to food and service.

François Bouvet, a starred Michelin chef from France, was brought to Cap Cana as food and beverage manager for all the restaurants. "We've always been polite to guests in the DR, but now we must add a level of professionalism and finesse."

He said that he's been given the budget to attract top talent. "There's no reason we cannot be the best," Bouvet said of the French restaurant at the Sanctuary and the Asian restaurant at the Caleton Beach Club.

If the quality of the golf at Cap Cana is any indication, that optimism may be warranted. Ben Nelson has seen a lot of the world's great golf courses.

The veteran PGA Tour official was in awe of the newest course in the Caribbean - and the site of the Cap Cana Championship, a spring stop on the PGA Champions Tour. "I can't tell you of a more scenic site I've seen anywhere," he said. "I just cannot imagine a finer beach property."